UK Shares Push Higher On Carney Speech

UK shares have risen for a third day, after Bank of England governor Mark Carney hinted at fresh stimulus measures following the Brexit vote.

The FTSE 100 index closed 1.13% higher, while the FTSE 250 was higher by 1.19%.

On Thursday, Mr Carney said a deteriorating outlook meant action from the Bank was likely this summer.

Share prices were further boosted after Chancellor George Osborne indicated the government would abandon its commitment to achieve a budget surplus by 2020.

This suggested that the austerity policies of the last six years might be eased in the wake of the referendum result.

The FTSE 250, which had started the day 0.41% higher, fell in mid-morning trade before recovering by lunchtime.

During the campaign, Mr Osborne had warned of the need for a combination of £30bn of spending cuts and tax rises if the UK voted to leave the European Union.

Despite the rally on the FTSE, bank shares were still under pressure, with Royal Bank of Scotland receiving the greatest amount of punishment from investors. The bank’s shares fell a further 3% by lunchtime before finishing 1.11% higher.